Is the nuclear energy “renaissance” reverting to the dark ages?

Two weeks ago we discussed the possibility of the Fukushima nuclear disaster affecting U.S. nuclear energy policy. Some 60 percent of readers said they believed the accident would cripple the future of nuclear energy.

I agreed with the majority of readers, essentially saying that the still-unfolding disaster would raise new regulatory hurdles and increase construction costs. This, I felt, would leave nuclear energy not competitive with natural gas.

NRG Energy will no longer invest in the South Texas Project nuclear expansion near Bay City and will write down its investment in the face of deeply diminished prospects for the project since Japan’s worst-ever nuclear accident.

“The project is not dead,” CEO David Crane said Tuesday, “but it’s not moving forward at this point, and to be frank, under the current circumstances, the reality of it moving forward in the foreseeable future is not high.”

The company plans to record a first-quarter pretax charge of roughly $481 million from Nuclear Innovation North America, its joint venture with Toshiba Corp., NRG said.

I spoke with a source in the energy community and he said the project is indeed pretty much dead.

South Texas Project Nuclear Power Plant.

We’re just a couple of years from a time when there was renewed optimism about the future of nuclear power. The South Texas Project was part of a small wave of new expansions planned at U.S. nuclear facilities after a long freeze. Now that optimism has evaporated.

Interestingly, Exxon CEO Rex Tillerson said just this week he sees nuclear energy holding its own during the next few decades globally, saying: “Ultimately, my expectation is the component of nuclear energy that will be in the future mix 25 years from now, or 30 years from now, is probably not changed.”

Nevertheless money talks. And in the case of the South Texas Project, the money is walking away.